Wednesday, January 13, 2010

5 Reasons For A Revolutionary Year In The Music Biz

There was an interesting article at yesterday entitled, "5 Reasons Why 2010 Will Be Revolutionary For The Music Biz." The article made a few good points, but I'm not so sure if I agree with every premise. Here are the 5 reasons outlined in the article, along with my thoughts on each.

1) The Ticket Master/Live Nation merger. The article states that the merger will enable the new company to sell entertainment packages in such novel ways that it will impact ticket sales for the better. I think that what's really going to change the concert business is the backlash from consumers on a variety of issues, including sky high prices, premium seats only available through ticket brokers, and too many unnecessary ancillary fees. The revolution is indeed coming, but it's the consumer who will be doing the impacting, not TM/LN.

2) The Performance Rights Act changes radio. The Performance Rights Act enables artists other than songwriters to get paid for airplay. The way it is now, only the writers of "You've Lost That Lovin' Feeling" get paid for every one of it's more than 7 million plays while the Righteous Brothers never made a penny. The Performance Rights Act makes sure they're finally given a tiny sliver of compensation for singing the song. The NAB has been painting the act with gloom and doom, stating that radio stations will be going bankrupt everywhere, or turning to talk radio. it might actually be a good thing if they go bankrupt and let someone else take over, but that will never happen. Instead of "big radio" making a big profit every year, they'll make a slightly less big profit and move on.

3) Internet Service Providers become partners. The article states that this is the year when ISPs start enforcing pirating laws and collecting fees for the record labels. Yeah, dream on. The ISP's will merely respond, "Hey, we're just the pipe. You guys are the water flowing through it. Regulation is up to you the way it's always been!" Having the ISPs do the labels dirty work and collecting money for them is just a label fantasy.

4) Spotify will raise the bar for mobil music. If you don't already know, Spotify is a subscription music service that's been pretty successful in parts of Europe, but has yet to debut here in the US because of licensing issues with a few of the major labels. The service is supposed to get going here in 2010, but reports are that it's severely hampered by cash flow and may never have the bucks to be able to put if over the top. My bet is that Apple begins it's iTunes subscription service in 2011, at which time music subscription will take off.

5) Almost any way you slice it, EMI will reshape the industry. EMI used to be a major label but it's recently become a non-entity in the major label world. Cash-strapped, short on management, no respect, and few hits, the only thing it has going for it is a huge catalog. The article thinks that EMI will get turned around and become a major again (of course it would say that, Billboard would love to get some EMI ad dollars). The bet here is that those days are over and if it's lucky, EMI will be relegated to being a catalog manager if it stays alive at all.

Read the entire article at, then tell me who you agree with.

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